On 25 November 2009, the Swedish Competition Authority (the KKV) decided to grant a motion for an interlocutory injunction requiring Ekfors Kraft AB (Ekfors), an electric utility company, to connect the municipal street lighting facilities of Haparanda Stad (Haparanda), a Swedish municipality, to its power grid.
The decision marks a milestone in an almost three year long dispute between Haparanda and Ekfors; a dispute in which Ekfors had the upper hand until now. In 2006, Haparanda lodged a complaint with the KKV when Ekfors turned off the street lights as a result of a dispute regarding Ekfors’ prices for the provision of street lighting services. The complaint was dismissed and Haparanda initiated an action before the Market Court, without success. The question back in 2006 revolved around Ekfors not turning on its own lights. In addition to owning the local electric power grid in Haparanda, Ekfors also owns a network of street lights.
Deciding to take matters into its own hands, Haparanda built its own street lighting facilities in 2009.
In order to ensure that the new street lighting facilities would be connected to the power grid in time for winter, Haparanda made prior notifications to Ekfors on 1 September and 22 October 2009. The notifications made clear that Haparanda wished to be connected to Ekfors’ power grid. In response to the notification of 1 September, Ekfors stated that connection would not be granted as a result of unsettled financial matters. The notification of 22 October remained unanswered.
Ekfors holds an electric grid concession within certain parts of Haparanda. The question for the KKV was whether Ekfors had abused its dominant position by refusing to connect Haparanda’s newly built street lighting facilities to its grid.
The KKV determined that the relevant market concerned was the market for the provision of electrical power within the relevant concession area; the concession area partially located in Haparanda. By holding the concession for the relevant area, Ekfors was deemed to have a dominant position on the relevant market.
The KKV found that Ekfors had refused to supply a connection to its grid. By not supplying the connection to its grid, Ekfors made it impossible for Haparanda to operate its own street lighting facilities.
In the absence of any objective justification for its conduct, the KKV found that Ekfors had abused its dominant position, thus acting in violation of Chapter 2, Section 7 of the Swedish Competition Act (2008:579) (the Act). In accordance with Chapter 3, Section 1 of the Act, the KKV may require an undertaking to terminate an infringement of the Act. In addition, if particular grounds exist, an obligation pursuant to Chapter 3, Section 1 may be imposed for the period until a final decision is taken on the matter.
The KKV found that particular grounds existed in this case as, inter alia, the lack of street lighting during winter gives rise to traffic risks and is disadvantageous for the residents in Haparanda (Haparanda is located on the Finnish border in the far north of Sweden, enjoying daylight between approximately 8.30 AM and 1.30 PM during November). The final decision is still pending. But in the meantime, at least for this Christmas, the residents of Haparanda will enjoy the “gift” of light.
Source: Decision Dnr 533/2009 of the KKV available (only in Swedish) at http://www.kkv.se/upload/Filer/Konkurrens/2009/Beslut/beslut_0533_2009.pdf